Tata Consultancy Services Releases In-Depth IoT Study
Internet of Things technologies are taking root well beyond their big=marquee proponents, such as General Electric and Caterpillar, according to the findings of Tata Consultancy Services' (TCS) latest global trends study. This spring, the firm queried 3,700 executives from North American, European, Asia-Pacific, and Latin American companies, 79 percent of which said that they currently have IoT initiatives in place.

The 795 executives who completed the full survey come from companies that will invest an average of $86 million, or 0.4 percent of revenue, on IoT technology and associated services and consulting in 2015. The report's authors wrote: "This percentage may seem high, given that the average corporate IT budget is about 1 percent of revenue, according to Forrester Research. However, we believe that much IoT spending is coming from outside the IT budget – for example, supply chain automation (often found in the manufacturing budget) and mobile app monitoring (which is often a marketing expense)."

By 2018, the survey found, firms with more than $50 billion in revenues plan to spend, on average, $306 million on IoT programs; those with revenues between $10 billion and $30 billion plan to spend $110.6 million; and firms earning between $1 billion and $5 billion think they'll spend $60.4 million on IoT programs.

TCS contracted online market research company Research Now to conduct a survey that focused on how firms are using IoT technologies to track their customers, products, premises and supply chains. More specifically, questions focused on how surveyed companies are creating revenue sources or new businesses through selling products that leverage IoT technology. They were also asked to describe how they are improving their products and services by incorporating IoT technology in them, and by tracking customers, the locations at which they do business with those customers, and their supply chains.

The survey found that 47 percent of responding companies track customers via mobile apps, whereas 45 percent use IoT technologies to monitor production and distribution operations. It is far less common for companies to use sensors inside their products to track customer behavior, the report found—only about a quarter do this.

TCS detected a correlation between IoT investments and revenue, with the revenues increasing by an average of 16 percent last year within the business departments that have invested in IoT technologies. "Nine percent of respondents attributed a revenue rise of more than 30 percent to their IoT efforts," the report notes.

In addition to the survey, TCS conducted qualitative research by interviewing executives at General Electric, Hewlett-Packard, Intel and PTC. Summaries of those interviews are included in the full 186-page report, which is available for download here.